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Fitch Affirms Syracuse IDA (NY) School Facility Revs at 'A'; Outlook Revised to Stable.

NEW YORK New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of
 -- Fitch Ratings Fitch Ratings

An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris.
 affirms Syracuse Industrial Development Agency's (IDA Ida (ē`dä), city (1990 pop. 91,859), Nagano prefecture, central Honshu, Japan, on the Tenryu River. It is an agricultural market and railway junction. ) school facility revenue bonds (Syracuse City School District Project) series 2008A at 'A'. The Rating Outlook is revised to Stable from Positive.

The 'A' rating reflects the nature of the pledged revenue stream, satisfactory debt service coverage on all related obligations, and general credit characteristics of the State of New York. The rating further reflects the appropriation risk associated with the city and school district although Fitch believes this risk is minimal as state intercept of revenues is triggered upon non-appropriation. The revision of the Rating Outlook to Stable from Positive reflects the macroeconomic mac·ro·ec·o·nom·ics  
n. (used with a sing. verb)
The study of the overall aspects and workings of a national economy, such as income, output, and the interrelationship among diverse economic sectors.
 issues the State of New York is experiencing.

The bonds are payable from the trustee-held, pro rata [Latin, Proportionately.] A phrase that describes a division made according to a certain rate, percentage, or share.

In a Bankruptcy case, when the debtor is insolvent, creditors generally agree to accept a pro rata share of what is owed to them.
 set-aside of state aid remitted to Syracuse City School District (SCSD SCSD Syracuse City School District (Syracuse, New York)
SCSD School of Communication Sciences and Disorders
SCSD Suffolk County Sheriff's Department (Massachusetts) 
) during the period from Dec. 1 to March 31 in each fiscal year. Upon appropriation by Syracuse (the city) and SCSD, the set-aside funds are deposited into the bond fund, and only then are pledged to the payment of debt service. State aid remitted during the fiscal 2008 December to March collection period provided over 40 times (x) coverage of maximum annual debt service (MADS) on the series 2008A bonds. In the event adequate funds to pay debt service are not available by April 1 for any reason including an event of non-appropriation, the state aid intercept mechanism is triggered, intercepting any remaining state aid payable to SCSD during such fiscal year. As the debt service payment date is May 1, state aid intercepted in the month of April is not expected to be sufficient to pay debt service. Bondholders benefit from a debt service reserve fund satisfied with a surety by FSA FSA Financial Services Authority
FSA Food Standards Agency (UK)
FSA Farm Service Agency (USDA)
FSA Financial Services Agency (Japan) 
. Fitch believes that an event of non-appropriation is highly unlikely as there is no incentive not to appropriate. If set-aside state aid during the December to March collection period is not appropriated, subsequent state aid is still intercepted until the debt service reserve is completely replenished.

State aid appropriated to SCSD may be intercepted as pledged payment for several other obligations including outstanding SCSD general obligation indebtedness totaling $160.1 million as of fiscal 2008 year-end, charter school payments totaling $9.9 million in fiscal 2009, and revenue anticipation notes Revenue Anticipation Note (RAN)

A short-term municipal debt issue that will be repaid with anticipated revenues, such as sales taxes, from the project.
 totaling $65 million in fiscal 2009. Fiscal 2008 state aid provided 2.7x coverage of aggregate MADS on all obligations that are subject to the intercept mechanism.

The $49.2 million series 2008A bonds were the first installment of $225 million in bonds authorized au·thor·ize  
tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es
1. To grant authority or power to.

2. To give permission for; sanction:
 under this financing structure. Currently, state building aid pays roughly 97% of the allowable construction costs on the 2008 debt offering. SCSD anticipates issuing additional debt under this financing vehicle in the first quarter of 2011.

State aid intercept ratings, such as this one, are correlated to state bond ratings and may rise or fall with a change in the state's bond rating, among other circumstances. New York's 'AA-' GO rating is based on the state's substantial wealth and resources and broad economy and also recognizes concerns, now heightened, regarding the outsized out·size  
1. An unusual size, especially a very large size.

2. A garment of unusual size.

adj. also out·sized
Unusually large, weighty, or extensive.

Adj. 1.
 role that the financial services The examples and perspective in this article or section may not represent a worldwide view of the subject.
Please [ improve this article] or discuss the issue on the talk page.
 industry plays in the state's economy and revenue system. State net tax-supported debt levels have been relatively stable as a percentage of personal income and are expected to remain above average but still in the moderate range.

About 20% of New York State tax revenue comes from the financial services sector and, as would be expected, the current downturn has been particularly troublesome for New York. The state took proactive positive steps to identify and address projected budget gaps over the course of fiscal 2009 as revenue forecasts were reduced steeply and out-year gap estimates rose sharply. The enacted budget for fiscal 2010, which began on April 1, 2009, resulted in minimal growth in state operating funds spending but incorporated a substantial amount of federal stimulus aid.

New York's economy, whose decline has lagged that of the U.S. in the current recession, is still performing considerably better than the nation. Non-farm employment was down 2.4% in June 2009, year-over-year, compared to a 4.2% drop for the U.S., and state unemployment for the month was 8.7%, 92% of the U.S. level. The state forecasts non-farm employment down 2.3% in 2009 and 0.3% in 2010. The financial activities sector accounts for about 8% of jobs and more than 20% of earnings in the state, compared with 6% and 10% for the nation. This has made New York vulnerable to economic cyclicality, particularly given the prominence of personal income tax receipts in the state's revenue structure. The state's personal income per capita [Latin, By the heads or polls.] A term used in the Descent and Distribution of the estate of one who dies without a will. It means to share and share alike according to the number of individuals.  is the fourth highest among the states, at 121% of the U.S. average. State personal income growth has been above that of the nation since 2004. The state forecasts a personal income drop of 2.7% in 2009.

The enacted budget for fiscal 2010 closed gaps estimated at $2.2 billion for fiscal 2009 and $17.9 billion for fiscal 2010, with these estimates including program expansions in current law that would have resulted in spending growth of a high 12.8%. The combined gap was closed through spending control, particularly in health care and education ($6.5 billion in total, including $1.7 billion from the elimination of a middle class property tax relief rebate check program); a temporary personal income tax rate increase that raises the top rate to 8.97% from 6.85% for tax years 2009 through 2011 that is estimated to generate $3.9 billion, as well as other revenue actions ($5.4 billion in total); $6.1 billion in federal stimulus monies; and $2 billion in other one-time resources. No deficit financing deficit financing

In government, the practice of spending more money than is received as revenue, the difference being made up by borrowing or minting new funds. The term usually refers to a conscious attempt to stimulate the economy by lowering tax rates or increasing
 was employed.

New York's net tax-supported debt is above average but still in the moderate range at 5.2% of personal income. Most of New York's debt has been issued by state public authorities and secured by appropriations; only about 7% is GO. While this results in a diffuse debt structure, there is strong centralization cen·tral·ize  
v. cen·tral·ized, cen·tral·iz·ing, cen·tral·iz·es
1. To draw into or toward a center; consolidate.

 and oversight in the budget division and approval by the public authorities control board is required for many of these bond issues.

Additional information is available at

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Publication:Business Wire
Geographic Code:1U2NY
Date:Nov 5, 2009
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